Monetary policy and international remittances

Isabel Ruiz () and Carlos Vargas-Silva

Journal of Developing Areas, 2010, vol. 43, issue 2, 173-186

Abstract: This article studies the response of Mexico’s monetary policy to inflows of workers’ remittances. Previous studies have shown that remittances can have an impact on several macroeconomic variables of the receiving country (e.g. exchange rate, inflation and output, among others). Mexico has the largest inflow of remittances in Latin America and the second largest inflow in the world. As such, it may be the case that the monetary authority in Mexico is taking these flows into account when selecting their monetary policy stance. Overall, the results of this study indicate that remittance shocks do not have a large impact on Mexico’s monetary policy variables. This seems to suggest that Mexico’s Central Bank main concern is inflation and that the potential appreciation of the Mexican currency as a result of increased remittance inflows might not be a priority.

Keywords: Remittances; Capital Inflows; Monetary Policy (search for similar items in EconPapers)
JEL-codes: E52 F22 (search for similar items in EconPapers)
Date: 2010
References: Add references at CitEc
Citations: View citations in EconPapers (9)

Downloads: (external link)
http://muse.jhu.edu/journals/journal_of_developing_areas/v043/43.2.ruiz.html

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:jda:journl:vol.43:year:2010:issue2:pp:173-186

Access Statistics for this article

More articles in Journal of Developing Areas from Tennessee State University, College of Business Contact information at EDIRC.
Bibliographic data for series maintained by Abu N.M. Wahid ().